A Nantucket yacht club recently agreed to pay 2.5 million dollars to settle a lawsuit by its former fitness director, alleging that it failed to properly respond to her complaints of sexual harassment by club members and then retaliated against her for those same complaints and her failure to sign a release. The settlement was reached during a mediation held days before the scheduled trial.
In her complaint, the plaintiff had alleged that two club members had touched her inappropriately and made offensive remarks about her and other female employees. The plaintiff claimed that when she first reported the harassment to her supervisor she was told to handle the matter herself.
After she complained to club management a second time, an investigation was undertaken which resulted in an offending member being asked to apologize and temporarily stay out of the fitness facility. In anticipation of that club member returning to the fitness facility, plaintiff became “overwhelmed with anxiety and fear.” She claims to have been told nothing more would be done to protect her and that she should take a personal day.
After she refused to take time off, she was offered a severance package in exchange for a release of claims. She was fired after she refused the severance offer for the stated reason of poor job performance.
Three weeks after she was terminated, the club sued plaintiff for breach of her employment contract. A jury found for plaintiff in September, 2013. Plaintiff sued the club for sexual harassment, retaliation, abuse of process, and malicious prosecution alleging lost wages, lost unemployment benefits, and emotional distress.
The plaintiff is just warming up because she plans to sue the yacht club’s insurer for $7.5 million dollars for bad-faith settlement practices based on its delay in offering any serious money to settle the case. This case is a prime example of how costly it can be for employers to ignore complaints of unlawful harassment in their workplace.